TSYS Inks a 7YR Processing ABN AMRO Deal

ABN AMRO has become the first card issuer to sign a processing agreement with TSYS in continental Europe. The seven-year agreement covers the processing of ABN AMRO consumer and commercial credit-cards.
All of ABN AMRO’s Dutch accounts will be converted to “TS2,” the
multi-currency and EMV-compliant processing system from TSYS that
supports more than 20 million accounts in Europe. Conversions are
tentatively planned for the first and second quarters of 2005. ABN
AMRO’s portfolio will be processed at the new TSYS European Data Center
in Knaresborough, England. The TSYS Operational Services
Center is located in Barneveld and opened earlier this month.

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Electronic Recovery’s eSoftPay Desktop is Upgraded

Florida-based Electronic Recovery announced the update of eSoftPay Desktop software. This version runs on the Windows platform and allows users to configure recurring ACH debits or credits, accounts receivable, as well as point-of-purchase transactions, pre-arranged consumer debits, and business-to-business transactions. Electronic Recovery, Inc., a division of Quick Check, Inc. provides software and services related to the processing of electronic payments.

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Card Fees Exceed Retail Gasoline Profits

The National Association of Convenience Stores says the huge increase in gasoline prices in 2004 and 2005 accelerated the trend of consumers paying with credit or debit cards. The NACS estimates that upwards of 70% of all gasoline purchases are now paid with plastic. As credit card usage and gasoline prices increase, so do the fees per fill-up. The NACS says this means that razor-thin profit margins for retailers selling motor fuels results in banks taking in more from a gallon than the retailers selling the fuel. Many retailers also have reported an increase in “drive-offs.” In addition, when gasoline prices rise, retailers lose in-store sales as consumers often curtail additional spending because of reduced discretionary income.

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Threats to Confidential Information Rise 44%

Malicious code activity created to expose confidential information such as credit card data continues to rise, driven in part by the proliferation of Trojan horses. A new report from Symantec shows that malicious code activity was up 44% in the first six months of 2004 and 36% in the second half. Symantec says its anti-fraud filters were blocking an average of 33 million phishing attempts per week by the end of last year, compared to an average of 9 million per week in July 2004. From July 1st to December 31st, Symantec documented more than 7,360 new “Windows 32” virus and worm variants. This represents an increase of 64% over the previous six-month period. At years end 2004, the total number of documented “Windows 32” threats and their variants was approaching 17,500. In the second half of 2004, Symantec documented more than 1,403 new vulnerabilities, with 97% considered “moderately” to “highly severe,” which means that successful exploitation of the vulnerability could result in a partial or complete compromise of the targeted system. The financial services sector experienced the highest ratio of severe attacks, with 16 severe events per 10,000 security events.

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TU Unveils 4 Incidence-Based Collection Models

Chicago-based TransUnion announced the release of four new collections recovery models. They include a generic all-industry model, as well as three others targeting bank and retail cards, auto and installment loans and medical debts. The models will assist collections organizations identify which customers are most likely to repay their debts and identify the most cost-effective treatment strategy based on the likelihood of repayment. TransUnion is a global information solutions company that offers a broad range of financial products and services that enable customers to manage risk and capitalize on market opportunities.

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Allpoint Surcharge-Free Network Tops 32K ATMs

The country’s largest surcharge-free ATM network has surpassed 32,000 ATMs. Two-year old Allpoint has announced the signing of Michigan’s largest independent savings bank, three state credit union leagues and Houston’s largest credit union. Michigan’s Flagstar Bank added 125 ATMs with Allpoint’s 750 in Michigan. In addition to Michigan, Flagstar Bank customers will have access to more than 2,000 free ATMs in the surrounding states of Illinois, Indiana, and Wisconsin. The partnership between Allpoint and the Pennsylvania Credit Union Association, Maryland Credit Union League and Delaware Credit Union League, was formed under the leagues’ CUSO, known as MARS (Mid-Atlantic Regional Services Corp.). The three state partnership with Allpoint provides participating state league members with unlimited surcharge-free access to 1,500 ATMs in Pennsylvania, 875 in Maryland and 180 in Delaware. Allpoint also provides Houston’s JSC FCU members more than 2,500 surcharge-free ATMs across Texas, 875+ in Houston alone, located at retailers such as Target, Costco, Circle K, and ExxonMobil. Launched in April 2003, Allpoint has grown from 23,000 ATMs to more than 32,000. Key network partners include Cardtronics, NetBank Payment Systems, Fiserv EFT, and America’s Community Bankers.

ALLPOINT SURCHARGE-FREE ATM HISTORICAL
2003: 23,000
2004: 25,000
2005: 32,000
Source: Allpoint

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NBS Enhances Netopia’s Merchant Success Bundle

California- based Netopia announced that its new Merchant Success bundle is being offered with complete POS solutions from NBS Technologies. The standard bundle is based on Netopia’s broadband Wi-Fi gateways and features NBS Technologies’ Commerce Gateway, which provides a secure, browser-based interface that allows businesses to process credit card transactions from any Web-enabled computer. NBS is a provider of smart card manufacturing and personalization equipment. Netopia, Inc. offers broadband products and services.

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HIMC Corporation to Acquire Fast Transact

HIMC Corporation will acquire Washington-based Fast Transact, a high performance Internet and retail credit card processor, for a combination of cash and HIMC stock, subject to approval by Fast Transact’s shareholders. Fast Transact, Inc., provides integrated electronic payment technologies for retail and Internet merchants nationwide. HIMC Corporation, through its wholly owned subsidiary ITI Internet Services Inc., is provider of payment services serving over 25,000 customers.

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MS 1Q/05

Morgan Stanley reported that credit card outstandings for its British
MasterCards topped $2.6 billion at the end of the first quarter, a 7.5%
increase over the year ago quarter. The number of accounts for its
“Classic,” “Gold,” “Platinum,” and “buy & fly!” cards rose 17% to 1.4
million, compared to one-year ago. For the quarter ending February 28th,
Morgan Stanley, which issues the “Discover Card” in the USA, posted
$2.648 billion in managed card loans, compared to $2.571 billion in
prior quarter, and compared to $2.463 billion for the first quarter of
2004. Last year, Morgan Stanley added the “buy and fly! MasterCard”
which earns one point for every GBP10 of purchases with bonus points
earned for purchases made at participating U.K. retail merchant
partners. Points can be redeemed for travel on 17 airlines. MS
introduced its first credit card in the U.K. in 1999. For complete
details on Morgan Stanley’s latest performance, visit CardData
(www.carddata.com).

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Anti-Phishing Solutions Directory Published

The Anti-Phishing Working Group announced the publication of its “Anti-Phishing Solutions Directory” to counter phishing attacks. The directory was developed after repeated requests from IT managers, analysts, researchers, government ministers, police and journalists. The initial classification scheme has 14 categories of solutions. The APWG is the global counter-phishing organization with more than 1200 members worldwide from nearly 700 companies and government agencies and 70 sponsors.

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Corillian and Quova Team to Stop Phishing

Corillian has partnered with Quova to protect financial institutions and eCommerce organizations websites from Internet-based attacks such as phishing. Phishing incidents have increased at the rate of over 40 percent a month, up to nearly 13,000 in January alone. California-based Quova, Inc. is the leading provider of geo-location services to online businesses. Corillian Corp. is a provider of online banking and anti-fraud solutions to financial institutions.

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U.S. Card Base Growth Shifts to Low Gear

The growth in general purpose credit cards in the USA slowed to an annual gain of 2.2% last year, about a third of the pace experienced just five years ago. At the end of 2004, there were 657.5 million U.S. credit cards active on the VISA, MasterCard, American Express and Discover networks. Over the past ten years the number of bank credit cards has increased 31% from slightly more than 500 million cards, according to CardData ([www.carddata.com][1]). VISA reported a 4.1% gain in credit cards for 2004, ending the year with 295.3 million cards. MasterCard posted a slight decline from 272.6 million credit cards to 271.5 million. American Express says its U.S. card base grew 9.6% to 39.9 million cards, which includes revolving cards and 30-day credit or charge cards. Discover, which does not officially publish card totals, is estimated to have 50.8 million cards in-force at year-end 2004, a slight gain over the 50.7 million in 2003. For complete details on the performance of all four major networks, visit CardData ([www.carddata.com][2]).

U.S. CREDIT CARD GROWTH HISTORICAL
2000: +7.3%
2001: +7.0%
2002: +6.3%
2003: +5.2%
2004: +2.2%
Source: CardData (www.carddata.com)

[1]: http://www.carddata.com
[2]: http://www.carddata.com

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